Toyota, which built its brand not around sizzle but quality and reliability, has allowed its rather ordinary recall to metastasize into a reputation-threatening crisis. Incentives seem to be putting a little more polish on the brand, but good PR is still essential for long-term performance.
Unlike Johnson & Johnson’s reaction to its Tylenol-tampering scare in 1982, Toyota officials chose to ignore complaints about sudden unintended acceleration in some of its vehicles. Rather than come forward with hat in hand to offer a heartfelt mea culpa to its customers, and to outline detailed plans to remedy the problem, the carmaker responded with delays, obfuscation and buck-passing. As a result, Toyota’s fleeting opportunity to take control of the story evaporated, leaving the automaker in an untenable public relations predicament.
Toyota’s inability to act quickly and implement a crises communications strategy to offset the flood of negative attention tarnishing its brand will likely be examined for years by PR wonks. The consensus view among PR and crises management professionals is that J&J’s bold handling of Tylenol’s safety scare was key to its success. In fact, within weeks J&J developed tamper-resistant packaging, which, in the end, served to heighten the value of the Tylenol brand by making product safety one of its hallmarks. What’s more, while J&J’s share price and market share plunged on the news, the pharmaceutical concern’s stock was 10% higher a month later due in part to J&J’s prompt response – something consumers and investors alike were willing to reward.
By contrast, following Toyota’s safety scare, its top brass are now facing a blistering inquiry by congressional members eager to parade their pro-American bona fides — or alternatively, score political points by soothing Detroit’s smarting ego. Long sensitive to the potential for backlash for becoming the market leader in worldwide sales, Toyota may also have to manage pent-up resentment in the U.S. generated by its displacement of General Motors from its leadership status at a time when U.S. manufacturing jobs are flagging. And in its all-out push to become the world’s top carmaker, Toyota admittedly strayed from its core value of focusing on the customer and quality.
Making matters worse, competitors, including Ford and GM, are now angling to exploit Toyota’s Achilles’ heel to poach customers by playing up their own vehicle safety records and promoting strides in dependability. Indeed, Toyota’s recall will test its legions of loyal customers.
But can Toyota still win the PR war and recover from the worst crisis in its storied history? In short, yes!
Toyota’s slow response to its sticking accelerators manifested the gulf between Western and Japanese corporate cultures (Toyota’s glacial decision-making process is legendary). No doubt, Toyota will apply the same rigor to resolving its safety issues that has made its widely emulated lean manufacturing philosophy and production line efficiencies the envy of world. The venerable Japanese company will need to effectively communicate these re-focused plans to the media … quickly.
Toyota can fine tune its communications strategy by evaluating their coverage and understanding who their key influencers are and what they’re saying. Check back next week for a look at how Toyota’s recall played out in traditional and social media.
Brian Panton is a quality assurance specialist and report writer in Washington, DC.Read Full Post | Make a Comment ( None so far )
Is Tiger the new Bill? Using Dow Jones media measurement tools, we compared media coverage of the current Tiger Woods scandal against five other indiscretions to see how long the golfer might expect his name to stay in the news for something other than golf. We looked at news mentions of Tiger Woods, David Letterman, Mark Sanford, Eliot Spitzer, and Bill Clinton in the months their scandals hit the news, the preceding three months to get an idea of “normal” coverage, and for six months after to see how quickly the scandals died down.
Of the five, New York Governor Eliot Spitzer had for the most dramatic rise in March 2008 when his sex scandal broke. Coverage increased a whopping 158% compared to his average volume of news in the three previous months. The scandal just as dramatically fell off the media’s radar, with a 171% drop in coverage in April.
Remember South Carolina Governor Mark Sanford’s dalliance in Argentina? Sanford experienced the second largest increase in coverage when it was reported he went “hiking the Appalachian Trail” in June 2009. However, in July, his coverage dropped only 20% – it took Sanford about 5 months to see the same proportional decrease that Spitzer experienced in his first month following the crisis (fast forward to the present and Sanford is back in the news recently as his wife has filed for divorce).
David Letterman’s scandal, if you can even call it that, is the biggest success story – news of sex with female coworkers received about the same amount of play as Sanford’s affair. Compared to a Southern governor, you’d expect much more from a scandal involving a celebrity national talk show host – just one more piece to the growing body of support for Letterman’s handling of the issue. His coverage only bumped up 70% in October 2009, quickly falling 99% in the first month following the scandal.
Tiger? Well, he certainly didn’t pull a Letterman out of his golf bag. Tiger’s trajectory is starting to look far more like that of former President Bill Clinton. When rumors first broke of the Monica Lewinsky scandal in January 1998, mentions of Bill Clinton increased at a similar level to Letterman. The problem for Clinton is that it didn’t go away – coverage of the scandal stayed pretty constant for the next 6 months. Tiger’s coverage rose 78% in November 2009; a considerable increase considering the scandal only broke around November 21. In the first two weeks of December, coverage of Tiger Woods is already 44% higher than in November.
With recent news about sponsors like Accenture dropping Tiger, coverage of this scandal isn’t likely to go away anytime soon either. Just don’t tell us it depends on what the definition of “is” is, Tiger.Read Full Post | Make a Comment ( 2 so far )